(Bloomberg) -- The developer of the Dubai mall housing an indoor ski slope plans to spend 14 billion dirhams ($3.8 billion) building its first residential development in the desert city.
Majid Al Futtaim Properties LLC will start selling homes this month in a 3 million square-meter (32 million square-foot) luxury development. It will include 6,500 homes, offices, shops, hotels and leisure facilities, Chief Executive Officer Robert Welanetz told reporters on Thursday.
The developer’s first foray into Dubai residential development comes at a difficult time for the city’s real estate market. The Persian Gulf sheikhdom is struggling with an oversupply of homes that’s pushing down values and rents. Demand from foreign investors, which had boosted the market in previous years, has waned amid currency fluctuations.
Luxury properties have been the worst-hit in Dubai’s property downturn but that isn’t dissuading Welanetz, who says well-built homes are still in demand.
“We are contributing to fill a niche in the market place” he said. “And we are here for the long term, so if it takes longer to build, we will be there to see it through.”
The Tilal Al Ghaf project will add 800 homes in the first phase, set to be completed in 2020. The housing development will be centered on a man-made lake in the desert that will serve as beach front for families living there.
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